DOW JONES AND S&P500 – POTENTIAL FOR TECHNICAL SELL SIGNALS TO BE GENERATED

Previous QMG technical analysis wires have flagged that parallels have existed between the broad rally that commenced in 2009, compared to that which occurred between 2002 and late 2007. The concerns have related to the US market recently being at the same overbought level on a momentum / RSI basis to that which had occurred in late 2007. The potential has now emerged for technical top formations / sell signals to be generated on the Dow Jones and S&P500. (A further sell off is still required to break key technical support levels). The potential for sell signals on the US indices has emerged shortly after sell signals were generated on the FTSE, DAX and CAC on 5/6/15, and earlier on the Hang Seng. The ASX200 index originally generated a technical sell signal at 5833 on 20/4/15. Obviously, the potential US index sell signals will need to translate to actual sell signals to be significant, but a trend change would seem to have commenced at a global market level from a technical perspective.